Court order bars Newspaper Archive Inc. and associated charity Global Way Makers, both with Cedar Rapids ties, from stealth collection of online donations
An international newspaper archiving company and related non-profit, both with Cedar Rapids ties, are barred from using a pre-checked box to obtain charitable donation authorizations from the company’s subscribers, through an agreement with Attorney General Tom Miller.
The agreement, called a consent judgment, approved Thursday by Polk County District Court Judge Robert B. Hanson, requires Newspaper Archive Inc. to change its business practices in Iowa, including the notices and disclosures it provides to its online subscribers.
Consumers had complained about the company’s automatic subscription renewals, billing practices, restrictive refund policies, unexpected price increases, difficulty in cancelling, and unresponsive customer service.
The billing practice complaints included Iowans who objected to negative-option charitable donation charges to a non-profit organization called Global Way Makers that the consumers had not intended to make.
The organization, which was first incorporated in California in 2003 as a religious corporation distributing humanitarian aid, was started by then-Californian Debora Leitner. Leitner later married Christopher J. (“Chris”) Gill, and in 2010 Gill’s company Newspaper Archive began using the pre-checked box to garner donations from the company’s online customers.
Both the company and non-profit list an identical Cedar Rapids address in several business filings, though the company lists a San Diego mailing address on its website.
Miller’s investigation indicated that Global Way Makers used the collected funds for charitable purposes. However, some of the funds were routed to schools or other causes in the Cayman Islands, where the Gills now reside, or to other charities associated with Newspaper Archive. Miller said that many consumers whose credit cards were charged for donations may not have chosen to donate, or would not have made the same choices the Gills made in re-distributing charitable donations.
“And that’s really the point,” Miller said. “Consumers deserve transparency about what they’re being charged for and why, so they can make their own decisions about charitable giving and other spending.”
The pre-checked box device for generating donations was used from May 2010 through June 2014. The amount collected as a donation from most individual consumers was less than $25, and was often only a few dollars. But some consumers were charged more than $200 for donations over the course of their subscriptions, whether they knew they were donating or not.
“Consumers deserve to be presented with a meaningful opportunity to decide for themselves whether to make a donation,” Miller said. “Here, online customers going through the checkout process for the archive subscription were unexpectedly presented with a request to donate to a charity, Global Way Makers. If they just clicked past the request, a pre-checked box was treated as authorization to charge the consumer’s credit card an extra $2 a month as a donation to Global Way Makers.”
The consent judgment requires the defendants to pay $100,000, primarily for refunds to consumers who were unwittingly charged for donations they did not intend to make. The defendants have provided payment records which will be used to make the refunds, but Miller also encouraged anyone who was charged for donations and wants a refund to contact the Consumer Protection Division.
Both defendants deny wrongdoing through the agreement and, according to Miller, cooperated in resolving the case.
For more information or to file a complaint, contact the Consumer Protection Division through the Attorney General’s website at www.iowaattorneygeneral.gov or email directly to consumer@ag.iowa.gov. Consumers can also call the Consumer Protection Division at 515-281-5926, or outside the Des Moines area, toll free, at 888-777-4590.
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